MGEA06H3 Chapter : Week 10 chapter notes
3 Dec 2010
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MGEA06H3 Full Course Notes
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Chapter 30 inflation and disinflation notes inflation rise in the average level of all pries; usually expressed as the annual percentage change in the consumer price index. N when real gdp is equal to y*, the unemployment rate is said to be equal to the nairu, which stands for the non-accelerating. N monetary validation of a negative supply shock causes the initial rise in the price level to be followed by a further rise, resulting. N sustained inflation is everywhere and always a monetary phenomenon www. notesolution. com. Sustained price inflation will be accompanied by closely related growth in wages and other factor prices such that the as curve is shifting upward. Factors that influence shifts in the as curve can be divided into two main components: output gaps and expectations. Random supply-side shocks will also exert an influence. Inflationary output gaps tend to cause wages to rise; recessionary output gaps tend to cause wages to fall.
